SEC brings case against pump-and-dump spammers

Posted by Virus Bulletin on Jul 11, 2007

Scam spotted after spammed mail sent to SEC lawyer.

Two men from Texas have been charged with a range of spam and fraud offences after a 20-month campaign using botnets to spam pump-and-dump mails aimed at pushing up the price of a range of 'penny' stocks. Their scam came to the attention of the US Securities and Exchange Commission (SEC), who have brought the case against them, after a spam pushing the stocks was received by a lawyer working for the Commission.

The two, 40-year-old Darrel Uselton and his 69-year-old uncle Jack Uselton, are described by the SEC as 'recidivist securities law violators', and allegedly used zombie networks to send out spam promoting stocks in at least 13 companies, swindling gullible recipients out of over $4.6 million in investments. $4.2 million of this has already been seized from accounts linked to the two men.

The SEC froze several of the 'scalped' stocks in March after noticing suspect activity, and vow to continue to punish perpetrators of such scams. Full details of the charges brought, which include money laundering and organised crime charges brought by Texas state and local law enforcement bodies, are in a release from the SEC here.

Over the last few years SE Labs has tested more than 50 different security products against over 5,000 targeted attacks. In this guest blog post Stefan Dumitrascu, Chief Technical Officer at SE Labs, looks at the different attack tools available, how…

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